Santander opens lifetime account for children

11 March 2014 | 1705 views | 0Source: Santander

Santander is shaking up the UK children's bank account market with the launch on 10 March of a new children's account that adapts to the needs of youngsters as they grow up and, at the same time, pays up to 3% tax-free on balances of up to £2,000. This means that youngsters can keep the same account all the way through to adulthood, when it becomes a full service current account.

The 123 Mini is available to anyone aged 0 to 18. For children aged below 11, a parent or guardian can open and manage the account as a trustee, if they already hold a Santander current account. The account can be handed over to the child any time after the child reaches age 11, up to age 18, by removing the trust.

Throughout the journey to adulthood, there is no need to close one account and open another. Customers keeps the same account details, such as their account number, debit card and any standing orders set up on the account.

The 123 Mini rewards customers with 1.00% AER on the total account balance from £100, 2.00% AER on the total balance from £200, and 3.00% AER on the total account balance from £300 up to a maximum of £2,000. The interest can be earned tax free, subject to the usual HMRC rules. There are no fees or charges on the account.

Reza Attar-Zadeh, Director of Retail Products for Santander UK, said: "We believe in helping families make the most of their money. With that in mind we designed the new 123 Mini to grow with the needs of youngsters and help them learn about money management from an early age. It's also great for parents or guardians who wish to retain control of the account whilst their children are still young. At a time when people are reviewing their finances and thinking about tax-free savings, 123 Mini is an obvious choice."

Santander has also developed an interactive online calculator supporting 123 Mini that can be personalised used by youngsters - and by their carers - to learn about managing money.

The bank's existing 11-15 and 16-18 youth current accounts will be removed from sale. Existing customers can continue to use the account as normal or they can also choose to upgrade to the new 123 Mini.

The 123 Mini is available to open in any Santander branch or through the Santander website (www.santander.co.uk). Applications to open the account in trust for a child under the age of 11 must be made in branch.